Overtime: to light a pest or is it okay? Startups are divided over their opinions

The overtime controversy – which recently sparked strong reactions from some of India’s top IT chiefs – has spread to the startup sector, which is clearly divided on the issue.

When it comes to side-job employees, the general feeling is to tread carefully, and I’ve found ET based on conversations with several startup heads across upGrad, Eruditus, Nykaa, NoBroker, Scaler, BankBazaar, HomeLane, and CashKaro.

While some said their organizations are okay with what employees do in their spare time as long as there is transparency and there is no conflict of interest, some said they would consider this on a case-by-case basis. Others have spoken out against overtime, saying it will weaken the employee’s contribution.

None of the companies ET spoke with have yet considered an official policy on overtime — a rising trend among white-collar employees, particularly in the IT/tech sector, amid the Covid-19 pandemic and work-from-home (WFH).

“Overtime can be a great way to improve skills that one does not get time to practice during their full-time job,” said Swati Bhargava, co-founder of CashKaro and EarnKaro.

She said her companies have no problem with employees working overtime as long as it doesn’t compromise their commitment to work. “But it needs to be monitored on a case-by-case basis,” Bhargava said. “Also, for seniors, I don’t think it’s practical given the nature of their role and responsibility.”

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At the other end of the spectrum, Amit Agarwal, CEO of NoBroker, said he personally opposes the concept. “Startups are all about innovation, sharing ideas, and solving customer problems around the clock,” he said. “That plus the time to regenerate leaves very little mental bandwidth for another job.”

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Overall, though, experts said startups seem ahead of the curve and more flexible than their IT counterparts when it comes to overtime.

“Startups tend to imagine the future better than large companies and can better identify trends and patterns. This is exactly why they have been able to disrupt and successfully outsmart big companies,” said angel investor TN Harry, co-founder of Arta School of Entrepreneurship.

“They know that letting employees do what they want to do in their spare time (except working for a direct competitor) is the future, and it’s better for them to embrace this trend than fight it,” he said.

Creative and skilled people are joining startups to chase vision, make a difference, and redefine the industry, said Sandeep Murthy, partner at VC Fund Lightbox Ventures. “If you can’t get them to be stimulating enough or motivate them enough to stay engaged, you can’t expect them to sit and wait idly at their leisure,” he added.

Sriram Vaidhyanathan, Chief HR Officer at BankBazaar said, “We have had instances where employees wanted to take on side quests, pursue a passionate project, etc. We take it on a case-by-case basis and follow the 3C principle – see what type of contract the employee has, and whether There was a conflict of interest, and whether he was informed of the nature of the job. We are also checking the business interest involved.”

He said the extra work could be more of a challenge for larger companies because they usually have signed contracts with end customers. “But in a startup environment for small and medium-sized businesses, it can generally work,” Vaidhyanathan added.

Abhimanyu Saxena, co-founder of InterviewBit and Scaler, said employees should be free to do whatever they want outside working hours, provided there is no conflict of interest. “Companies that are flexible will attract more talent than those that are flexible,” he said.

Overtime made headlines in recent weeks after Swiggy launched a policy that allowed its employees to work in the moonlight, subject to internal approvals. Since then, some of the major IT companies including Wipro, Infosys, and IBM have opposed the practice. However, some like C.P. Gurnani, CEO of Tech Mahindra, said his company might set up a policy so employees can open up about it.

Everything is uncomfortable

While Nykaa CEO Falguni Nayar said she’s more traditional and doesn’t believe in side hustles without the company’s knowledge, Ashwin Damera, CEO of Eruditus, said overtime is unethical unless the person tells and agrees with the employer.

upGrad, too, discourages overtime. Mayank Kumar, co-founder of UpGrad, said, “Education is hard work and such (overtime) practices can defocus our employees from their core vision…and also affect our learners negatively.”

Similarly, Srikanth Iyer, co-founder of HomeLane, said, “When employees shine, it dilutes their contribution, if not in the short term, then certainly in the long term.”

Agarwal of NoBroker said, “The reason we offer generous ESOPs at NoBroker is because we consider our fellow owners to be owners, and this requires their dedicated focus. The risk of burnout and distraction (from extra work) is very high when a startup is in the process of experimenting and scaling.”

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